The Companies Act 1985 (Small Companies’ Accounts and Audit) Regulations 2006

• Citation: S.I. 2006/2782
• Sections: 7

Section 1 Citation, commencement and interpretation

(1) These Regulations may be cited as the Companies Act 1985 (Small Companies’ Accounts and Audit) Regulations 2006.

(2) These Regulations come into force on 8th November 2006 and apply to annual accounts and reports in respect of financial years ending on or after 31st December 2006.

(3) In these Regulations, the “ 1985 Act ” means the Companies Act 1985.

Section 2 Disapplication of special accounting provisions for small companies

(1) Section 247A of the 1985 Act (cases in which special accounting provisions for small and medium-sized companies do not apply) is amended as follows.

(2) For subsection (1B) substitute—

(1B) A company that qualifies as small in relation to the financial year to which the accounts relate is ineligible if—

(a) it is a public company,

(b) it is an authorised insurance company, a banking company, an e-money issuer, an ISD investment firm or a UCITS management company, or

(c) it carries on an insurance market activity.

(1C) A company that qualifies as medium-sized in relation to the financial year to which the accounts relate is ineligible if—

(a) it is a public company,

(b) it has permission under Part 4 of the Financial Services and Markets Act 2000 to carry on a regulated activity, or

(c) it carries on an insurance market activity.

(3) In subsection (2)—

(a) in paragraph (b), after “a person” insert “(other than a small company)”, and

(b) for “or” at the end of that paragraph substitute—

(ba) a small company that is an authorised insurance company, a banking company, an e-money issuer, an ISD investment firm or a UCITS management company, or

(4) After that subsection insert—

(2A) A company is a small company for the purposes of subsection (2) if it qualified as small in relation to its last financial year ending on or before the end of the financial year to which the accounts relate.

Section 3 Exemption for small groups

(1) Section 248 of the 1985 Act (exemption for small and medium-sized groups) is amended as follows.

(2) In subsection (2)—

(a) in paragraph (b), after “a person” insert “(other than a small company)”, and

(b) for “or” at the end of that paragraph substitute—

(ba) a small company that is an authorised insurance company, a banking company, an e-money issuer, an ISD investment firm or a UCITS management company, or

(3) After that subsection insert—

(2A) A company is a small company for the purposes of subsection (2) if it qualified as small in relation to its last financial year ending on or before the end of the financial year to which the group accounts relate.

Section 4 Dormant companies

(1) Section 249AA of the 1985 Act (dormant companies) is amended as follows.

(2) In subsection (2)(a), for “of section 247A(1)(a)(i) or (b)” substitute “to it of subsection (1A), (1B)(a) or (1C)(a) of section 247A”.

(3) In subsection (3), for paragraph (a) substitute—

(a) an authorised insurance company, a banking company, an e-money issuer, an ISD investment firm or a UCITS management company;

Section 5 Cases where exemption from audit not available

(1) Section 249B(1) of the 1985 Act (cases where exemption from audit not available) is amended as follows.

(2) For paragraph (b) substitute—

(b) it was an authorised insurance company, a banking company, an e-money issuer, an ISD investment firm or a UCITS management company,

(3) Omit paragraph (d).

Section 6 Definitions

(1) Section 262(1) of the 1985 Act (minor definitions) is amended as follows.

(2) At the appropriate places insert—

“e-money issuer” means a person who has permission under Part 4 of the Financial Services and Markets Act 2000 to carry on the activity of issuing electronic money within the meaning of article 9B of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 ;

“ISD investment firm” has the same meaning as in the General Provisions and Glossary Instrument 2001 made by the Financial Services Authority under the Financial Services and Markets Act 2000 ;

“UCITS management company” has the same meaning as in the Collective Investment Schemes (UCITS Amending Directive) Instrument 2003 made by the Financial Services Authority under the Financial Services and Markets Act 2000 .

(3) In the definition of “regulated activity”—

(a) at the end of paragraph (cb) omit “or”, and

(b) after paragraph (d) insert—

, or

(e) article 64 (agreeing to carry on a regulated activity of the kind mentioned in paragraphs (a) to (d) above);

(4) In section 262A of the 1985 Act (index of defined expressions) , at the appropriate places insert—

Section 7 Consequential amendments

(1) Schedule 1 to the Limited Liability Partnerships Regulations 2001 is amended as follows.

(2) For the entry relating to section 247A substitute—

Omit paragraphs (a) and (c).

In paragraph (b), after “it” insert “is a person (other than a banking limited liability partnership) who”.”.

(3) In the entries relating to section 249AA—

(a) for the entry relating to subsection (2) substitute “In paragraph (a), omit “(1B)(a) or (1C)(a)”.”, and

(b) for the entry relating to subsection (3) substitute—

For subsection (3) substitute the following—

(3) Subsection (1) does not apply if at any time in the financial year in question the limited liability partnership was an e-money issuer, an ISD investment firm or a UCITS management company.”.

(4) For the entry relating to section 249B(1)(b) substitute the words “in paragraph (b), omit the words “an authorised insurance company, a banking company,”.”.